News Article

Adapting to the New Mobility, Consumer Needs

By Sofía Garduño | Thu, 09/29/2022 - 17:17

As the global automotive industry continues on its path toward connected, autonomous shared and electric (CASE) mobility, global automakers must adapt their product portfolio to the realities of the different markets where they operate. During this transition, hybrid vehicles, a technology-led cabin experience and the understanding of the local market will play a crucial role in the competition between brands, agreed industry experts.


“Electrification is undergoing an important transformation. In addition to digitization, we are also experiencing a change in habits in terms of mobility. In recent years, these habits have changed and the insertion of technology is making having a car more of an option than a necessity,” said Raúl Peñafiel, General Director, Jaguar Land Rover Mexico. 


While electrified vehicles still represent a small portion of the total vehicle sales in Mexico, their popularity grows yearly. During 1H22, from the total 518,424 vehicle sales, only 23,026 were electrified units (HEVs, PHEVs and BEVs), representing only 4.4 percent of the total sales, according to INEGI. Moreover, HEVs remained the most popular electrified vehicle in Mexico in 1H22, with 19,226 units sold, compared with the 2,097 PHEVs and 1,703 BEVs commercialized in the country.


However, EV sales are only expected to continue growing. “In 2028, over 50 percent of vehicles globally will be hybrid or electric,” said Miguel Barbeyto, President, Mazda. 


Japanese brand Mazda arrived in Mexico in October 2005 and in 2011, it decided to build a production plant outside of Japan for the first time in its history. Currently, Mazda’s complex in Salamanca, Guanajuato, is the automaker’s largest plant outside of Japan. Salamanca became a key facility for the company, reaching cumulative production of 1 million units in 2020. Mazda also sees great potential in electric vehicles. “Electrification improves productivity, offers more efficient vehicles and lowers CO2. The entire industry is heading in that same direction,” said Barbeyto.


Globally, Mazda has a clear electrification plan, called Zoom-Zoom 2030. By that year, all models offered by the brand will have an electrified version. The automaker will also reduce carbon emissions to 50 percent by that year. In Mexico, Mild-Hybrid Electric Vehicles (MHEVs) are Mazda’s first step toward electrification. In October 2021, the brand launched the technology with Mazda2. In March 2022, Mazda launched the Mazda3 sedan MHEV and the CX-30 MHEV.


While Mexico is still far from becoming a big market for BEVs, the country is expected to be the largest market for these vehicles in Latin America by 2026, according to Statista. In 1H22, a total of 3,170 PHEVs and BEVs were sold in Mexico, according to INEGI. In 2026, PHEV and BEV sales will amount to an estimated 18,900 units, according to Statista’s Mobility Market Outlook.


Although Mexico is accelerating this transition, there are still challenges ahead. While most automotive actors consider the lack of infrastructure to be the main problem, others believe that the dearth of financing and the culture of consumption is what is really hampering this transition. “There is a clash between the culture of consumption and a culture of sustainable mobility,” said Nazareth Black, CEO, Zacua. “The industry has to consider its clients more as users than as consumers and it is a challenge to create this culture from zero, she added.  Electromobility, however, could be truly be democratized through financing, said Black.


Zacua is a Mexican OEM focused on EV development. It produced the first 100-percent Mexican-supplied vehicle in history. The company started production in 2018 and that same year it released its first two models: the M2 and M3. Both models are manufactured at Zacua’s facilities in Puebla.


Improving Customer Experience: The New Objective

The greatest challenge the automotive sector faces might be addressing the demands of an increasingly informed and selective customer. “The consumer is looking for mobility. We are in the automotive industry, but we must evolve towards a mobility sector where we produce not only vehicles but also any object that can help the user to move,” said Barbeyto. 


To continue progressing towards the new concept of mobility, technology is evolving rapidly. “Experiences cannot be created without technology. Before, the sector offered technology that most customers did not get to use. Now, the customer wants new experiences with technology in a usable format. Technology must be put at the service of experience,” added Peñafiel.


Jaguar Land Rover is the largest automaker in the UK. The company exports vehicles to 136 markets, including Mexico. The brand has also adopted the electrification trend in Mexico, offering a variety of MHEVs, in addition to three PHEV Range Rover SUVs and the Jaguar I-Pace, a fully-electric SUV with an autonomy of 470 kilometers.


Overall, the sector has been forced to adapt to these rapidly evolving times. “In this sector, we are living interesting times. One flaw of humans is that we are not aware that everything changes and currently we are living in one of the most important times of this industry. We have the privilege of being forced to change,” said Peñafiel. 

Sofía Garduño Sofía Garduño Journalist & Industry Analyst